Rex Airlines will be purchased by US-based air services company Air T Inc, with the deal to lift the debt-laden airline out of administration and be recapitalised, ending a period of uncertainty for Australian aviation.
The deal, announced late on Tuesday, will provide regional Australia with the first glimmer of stability over its air transportation options after Rex spent more than a year in limbo.
Regional Express, better known as Rex, collapsed into administration in July.Credit: Kate Geraghty
However, administrators E&Y warned that 4800 creditors who are owed a combined $500 million will probably receive nothing.
“No return to shareholders is anticipated,” E&Y said, in a statement, although a further update will be provided ahead of the second meetings of creditors.
Rex Airlines was placed into administration with crippling debts in July 2024, with the Albanese government vowing to back the airline, which has a crucial role in connecting regional Australia to major cities.
The Charlotte, North Carolina-based aviation servicing company’s decision to buy Rex draws to a close a saga that has dragged over a year, as the administrators sought to sell the troubled airline.
Air T, which has provides transportation for FedEx, also services commercial aircraft, engines and parts, and provides ground support equipment, including de-icers. Calls to the company were not immediately returned.
In 2024, the federal government gave up to $80 million in loans to keep Rex’s regional routes operating until mid-2025. It also took on $50 million of debt from Rex’s largest creditor, PAGAC Regulus Holdings Limited this year, to ensure Rex could keep flying.
